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Proposed Accounting Standards Update

On August 3, 2017, the Financial Accounting Standards Board (FASB) issued a proposed Accounting Standards Update (ASU) aimed at clarifying and improving accounting guidance for contributions received and made, primarily by not- for-profit organizations. The proposed ASU can be found at www.fasb.org and stakeholders can provide comments until November 1, 2017.

There has long been diversity in practice for revenue recognition of grants and contracts with government agencies and others. These differences in approach have been under renewed focus under the FASB’s new revenue recognition standard (ASC Topic 606). The proposed ASU provides a suggested framework for determining whether a transaction should be accounted for as a contribution or as an exchange transaction, as well as verbiage to help distinguish between conditional and unconditional contributions. The FASB has summarized key provisions of the proposed ASU at http://www.fasb.org/cs/ContentServer?c=Document_C&pagename=FASB%2FDocument_C%2FDocumentPage&cid=1176169225224.  

On August 3, 2017, the Financial Accounting Standards Board (FASB) issued a proposed Accounting Standards Update (ASU) aimed at clarifying and improving accounting guidance for contributions received and made, primarily by not- for-profit organizations. The proposed ASU can be found at www.fasb.org and stakeholders can provide comments until November 1, 2017.

There has long been diversity in practice for revenue recognition of grants and contracts with government agencies and others. These differences in approach have been under renewed focus under the FASB’s new revenue recognition standard (ASC Topic 606). The proposed ASU provides a suggested framework for determining whether a transaction should be accounted for as a contribution or as an exchange transaction, as well as verbiage to help distinguish between conditional and unconditional contributions.  

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